By Max Oliva
In South Africa, effective small-scale farming, arguably a means to combat rural poverty, stands as the cornerstone to establishing new and sustainable agricultural value systems.
Large commercial farmers dominate the local agricultural and food system, which limits the participation of smaller producers, creating a dualistic farming system. Additionally, most major supermarkets and food manufacturers prefer working with a small number of larger suppliers who can meet stringent requirements. This leaves many small rural producers excluded and marginalised since they cannot meet the quality or consistent volume requirements for large corporations to consider dealing with them.
Small-scale producers struggle to overcome these limitations, primarily due to a lack of access to funding, technical and business support, food safety expertise and compliance, and the infrastructure and logistical resources, or capabilities, needed to enter formal value systems. Poor farm infrastructure and farm inputs is often the root cause for inconsistent crop yields and quality. Addressing these intricate issues necessitates a collaborative approach involving a diverse range of stakeholders.
And this needs to happen now. According to the World Bank, Sub-Saharan Africa is feeling the brunt of “the perfect storm” – a food, fuel, and fertiliser crisis exacerbated by the war in Ukraine, scarring effects from the Covid-19 pandemic, soaring inflation, rising debt and extreme weather.
No priority is more pressing than addressing food insecurity to safeguard the calorie and nutrition needs of Africa’s one billion people and protect their human development. At least one in five Africans goes to bed hungry, and an estimated 140 million people in Africa face acute food insecurity, according to the 2022 Global Report on Food Crises 2022 Mid-Year Update.
As the United Nations astutely observes, climate change does not respect boundaries. Hence, it is necessary for African countries and a broad range of role players to work together to build resilience. In South Africa, it is also critical that a broad church of stakeholders play their role, pivotal among these being the corporate sector.
The retail industry must play a central role in helping close gaps to food security and market access.
In The Spar Group’s own experience, just by including farmers in a Rural Hub skills transfer and empowerment concept in 2016, we are currently seeing between 30% to 60% of these farmers’ monthly output purchased by us and brought to the market, under our Freshline and Country Value labels, through distribution centres in key locations. We plan to increase the support from Spar to 80% in 2024/2025.
While The Spar Group remains their primary customer, some of the grade one produce is also sold to aggregators who then on-sell the produce to other food retailers. Many farmers also continue to grow private crops for their communities.
Projects like this are key to improving food security and the health and well-being of people in rural communities. As our farmers graduate from the programme over the next three to five years and move on to farm sustainable and profitable enterprises, they will no longer require our support – which is ultimately the end-goal. Plans are underway to scale up to include additional farmers and products in 2024.
At a time when food security is so critical, this all helps to guarantee a market for farmers, reduces delivery distances through strategically located rural hub packaging facilities, cuts transport costs, and benefits the environment by lowering emissions.
But quality assurance goes beyond logistics; it demands sustainable farming methods. So, any solution to South Africa’s rural development challenges must include the implementation of regenerative farming practices and comprehensive training in farm management and food safety.
Food safety is non-negotiable. In this regard, I believe safety programmes must be benchmarked against global standards, like full GLOBALG.A.P certification, and packaging facilities must meet GFSI Global Markets standards.
Again, increased collaboration is the key ingredient to success in closing gaps and stimulating growth that is so critical to South Africa’s food sector. This collaboration should take place among all relevant stakeholders, including farmers, communities, government bodies, food manufacturers, input suppliers, wholesalers, retailers, financial institutions and funders.
Another pressing issue within the food supply and retail chain in South Africa is food waste. Of the approximately 31 million tonnes of annual food production, nearly 10 million tonnes go to waste.
Recognising that most food waste occurs at farms, it is critical to actively work with producers to reduce these volumes through internal food buying and sales incentive policies, the buying and selling of “imperfect” produce (where it makes sense for food security), as well as collaboration with various stakeholders, including government and industry partners.
Those taking steps in the direction of developing food programmes must sign up as a signatory to the Consumer Goods Council of South Africa's (CGCSA) Voluntary Food Loss and Waste Agreement.
I also see the United Nations' sustainable development goal of halving per capita global food waste by 2030 as one that all organisations should aspire to, and it should be included in their strategic intent.
As one of South Africa's leading consumer brands, we are committed to making a positive impact and will continue to support initiatives aimed at driving an inclusive agricultural sector, maximising food production and ensuring food security.
Max Oliva is the CEO of The SPAR Group Southern Africa.
BUSINESS REPORT